Comment Re:And patents, of course (Score 3, Insightful) 625
Yes and no. Patents are a problem -- you can NOT launch a small technology firm and make anything useful without violating patents. This is a barrier to US businesses and Europe, but not China as they will simply ignore patents (for their domestic market).
I'd say America lost because Wall Street *wanted* America to lose. Maybe not explicitly, but as a result of all those outsourcing tax credits Wall Street wanted.
Talk to a US based electronics manufacturer... all of them had NO CHOICE but to move their R&D to China, because that's where all the manufacturing is.
Often times, the latest and greatest micro chip thingy will be documented by a Data Sheet which is written in Chinese. Eventually it will be translated to English, but the part might be depricated by then if it is a short lived market item.
Linksys, D-Link, Buffalo etc. all of these router manufacturers have almost NO knowledge what is in "their" products. They simply say "I'll take one of those" from the ODM and slap their web GUI on the firmware.
Apple is the last remaining US manufacturer who -designs- in the US. They pay a high price in terms of cost of operating. And even then, all their manufacturing is outsourced, and they don't really R&D any of the low level stuff.
Back to my original point... even if you reformed patents, and even un-did the Bush era outsourcing credit, NONE of those R&D jobs would come back. You'd have to convince China and Japan to subsidize their businesses to move operations back to the USA. No other country is dumb enough to kill their manufacturing, deliberately.
But hey, Wall Street knows what it's doing... killing US manufacturing kills unions, and higher unemployment means workers will accept forced overtime and less safe working conditions. It's all pretty basic stuff, really.